SAN MARCOS -- During the workweek, empty beer kegs tower in front of a merchandise display case and a pallet of grain bags sits against the edge of the bar at the Stone Brewing Co. Nearby, forklifts zig-zag around stainless-steel fermenters, and off to the side workers clean a metal bottling machine.

As the weekend approaches, however, workers clear away all of the pallets and the small bar with four taps becomes a "tasting room" for visitors who want to sample the "full-flavored beers" on Friday and Saturday afternoons.

The company, which brews six types of beers year-round and five speciality beers, tries to make use of all the available space in the warehouse, but officials said they have started to look for a new location because they expect to run out of room in the next couple of years.

"Our No. 1 goal is to stay in San Marcos, our No. 2 goal is to stay in North County and our No. 3 goal is to stay in San Diego County," said CEO Gregory Koch. "I'm pretty confident that we're going to stay in North County, but it's going to be a challenge to stay in San Marcos because there's not much available land."

The company, which sells its beer at 516 locations in North County, started looking for possible sites at the end of 2002 and Koch said they hope to have a location selected in the next couple of months.

Brewery officials wouldn't say what particular sites they were looking into, but said they want to move their operations to a 50,000-square-foot brewery in 2005 that could be expanded to about 100,000 square feet. The company, with about 60 employees, expects to outgrow the 26,500 square foot warehouse off Rancheros Drive.

In the past seven years the brewery's production has increased from 2,000 barrels a year to a projected 26,000 barrels this year, and the company expects to produce 35,000 barrels next year, Koch said.

"All of the cities in North County, including San Marcos, have being strongly wooing us," said Koch, who sported a blonde Mohawk -- an informal theme of the brewery's seven-year anniversary festival last Saturday. "City council members and economic development staffers have tried to work with us so that we could come to their cities," he said.

The City of San Marcos has pointed out several possible sites to the brewery, and the two sides have been working together to find a location, said Charlie Schaffer, the city's development director.

"We're encouraged by the success of their business, and we're interested in keeping them here," Schaffer said. "One issue that could impact what sites are available is if they decide to have a small restaurant attached to the brewery because then it couldn't be too close to a residential area."

Stone officials said a restaurant was "a potential," but that it was not one of their top priorities in finding a new location. Two years ago Stone Brewing entered escrow on a 4.2-acre site on Nordahl Road, but the brewery scrapped the plan after neighbors complained to the state Department of Alcoholic Beverage Control that the restaurant would create noise and traffic problems.

"There's a possibility that there will be a restaurant and a viewing platform so people can still see the whole process," said Steve Wagner, the president and brewmaster. "But I'm just really excited that we will be able to design a place, and it will be built to accommodate growth and expansion."

Wagner and Koch expect the business to continue to grow, and their beers have become available in 18 states across the country, including New York, Massachusetts and Texas.

Stone's beers were sold for the first time in Colorado on Monday, and three weeks worth of beer sold in two days, according to Koch.

With the continued growth, Koch said the company's sales are expected to rise from $6 million in 2002 to about $8.5 million this year.

But despite the increases in their distribution area, the brewery officials want to still concentrate on the local market.

"Sixty percent of our business is in Southern California," Wagner said. "This is our home, and it's very important to us that we succeed here."

Contact David Sterrett at (760) 761-4414 or dsterrett@nctimes.com